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The Gulf markets are mixed due to geopolitical concerns and Fed outlook

The Gulf markets are mixed due to geopolitical concerns and Fed outlook

The Gulf stock markets were mixed on Thursday morning as tensions in the region escalated. However, there were signs that the Federal Reserve might still be able to deliver two rate reductions this year.

The Fed kept interest rates steady on Wednesday, as was anticipated, and reiterated its forecast for two quarter-percentage-point rate cuts before the end of the year.

The Fed's decisions affect monetary policy across the Gulf, where the majority of currencies, such as the Saudi Riyal, are pegged against the U.S. Dollar.

Saudi Arabia's benchmark stock index rose 0.2% thanks to a 1.4% increase in ACWA Power Company, and a 0.2% rise in Saudi Aramco.

The oil prices that are the catalyst for Gulf financial markets rose on Thursday. This was boosted by the strong outlook for US demand after fuel inventories dropped more than expected and the weaker dollar.

Dubai's main stock index rose 0.3%. The top lender Emirates NBD gained 0.8% while blue-chip developer Emaar Properties grew 0.4%.

Alpha Dhabi Holding, which fell by 0.2%, was the main culprit for the 0.4% drop in Abu Dhabi.

Israel began a ground operation on Gaza Wednesday, after the ceasefire which had been in place since January was broken. Israel and the Palestinian militant group Hamas both accuse the other of violating a truce.

Qatar Islamic Bank lost 0.4%, while the Qatari index fell 0.2%.

(source: Reuters)